Data Published in Science Translational Medicine Point to Role of Cellular Bioenergetics as a New Mechanistic Approach to Treat Immune Disorders

PLYMOUTH, Mich. – January 26, 2011 – Lycera
Corporation, a biopharmaceutical company pioneering an innovative
approach to developing novel oral medicines to treat autoimmune
diseases, today announced positive data from the University of
Michigan demonstrating the role of bioenergetics in selectively
inhibiting pathogenic lymphocytes while preserving and enhancing
the normal immune system. The findings, published online today in
Science Translational Medicine, support Lycera’s promising
novel therapeutic approach to treating a broad spectrum of immune
diseases.

Cellular bioenergetics is a field of biology focused on studying
how energy is made and utilized in living systems in both normal,
healthy cells and disease-causing cells. Lycera’s
bioenergetics program is focused on developing orally available
small molecules that exploit bioenergetic abnormalities in
pathologically activated lymphocytes and result in the selective
silencing of these cells, while keeping healthy immune cells
intact.

The data show that bioenergetic and redox properties of
alloreactive T cells differentiate them from other proliferating
cells and can be exploited pharmacologically to arrest
graft-versus-host disease (GVHD) in mice. In the study, treatment
with Lycera’s prototype compound Bz-423, a first-in-class
F1F0-ATPsynthase inhibitor, induced selective apoptosis of
alloreactive donor T cells and reversed GVHD in several bone marrow
transplantation models without affecting hematopoietic stem cell
engraftment, immune reconstitution or normal resting
lymphocytes.

“The preclinical data suggest that alloreactive T cells
rely primarily on oxidative phosphorylation for their energy,
challenging the current paradigm that activated T cells meet their
increased demands for energy through aerobic glycolysis,”
said lead author Gary D. Glick, Ph.D., Lycera founder and chief
scientific officer, and Werner E. Bachmann Collegiate Professor of
Chemistryat the University of Michigan. “This difference,
along with the phenotype of T cells, provides a mechanistic basis
for the specificity of Bz-423 to eliminate disease-causing cells.
The specificity and the ability to preserve normal immune
reconstitution differentiate Bz-423 from high dose systemic
steroids, the current standard of treatment for GVHD. Efficacy has
also been demonstrated in autoimmune disease models where
pathogenic cells have similar bioenergetic characteristics. The
robust body of preclinical research is very compelling, and we look
forward to entering the clinic with our lead compound in
Lycera’s bioenergetics program this year.”

The researchers tested the potential of Bz-423 to halt the
progress of established GVHD in two allogeneic bone marrow
transplantation models. Treatment with Bz-423 significantly reduced
GVHD clinical scores after one week and improved survival in mice
compared to controls treated with vehicle (75% vs. 29%, p<0.02).
Similar improvement in survival was seen when treatment was
continued for 10 weeks (74% vs. 29%, p=0.02). In another aggressive
model of GVHD using a fully allogeneic donor/recipient strain
combination, Bz-423 treatment for seven weeks again significantly
reduced all clinical and histological parameters of disease. Bz-423
did not impair immune reconstitution in either the thymus or spleen
and all the mice treated with the drug showed complete donor bone
marrow engraftment. Additionally, the compound’s favorable
toxicity profile is consistent with other studies and with the
normal bioenergetic and redox profile of rapidly proliferating bone
marrow cells (basal rates of oxygen consumption, normal levels of
anti-oxidants and stable mitochondrial membrane potential).

Cellular bioenergetics is a field of biology focused on studying
how energy is made and utilized in living systems in both normal,
healthy cells and disease-causing cells. Cells generate
adenosine-5'-triphosphate (ATP) by aerobic glycolysis and oxidative
phosphorylation.Despite the importance of having sufficient ATP
available for the energy dependent processes involved in immune
activation, little is known about the metabolic adaptations that
occur in vivo to meet the increased demand for ATP in activated and
proliferating lymphocytes.

Lycera has unique expertise in the emerging area of cellular
bioenergetics. The aim of Lycera’s bioenergetics program,
which originated from the lab of Dr. Glick at the University of
Michigan,is to develop orally available small molecules that
exploit bioenergetic abnormalities in pathologically activated
lymphocytes and result in the selective silencing of these
cells.Testing has been conducted in preclinical models of lupus,
rheumatoid arthritis, psoriasis, graft-versus-host disease and
other medical conditions. The mechanism has been supported by
extensive published and unpublished work over the past eight years
and has generated multiple potential drug candidates. Preclinical
data characterizing the metabolic phenotype of pathologically
activated lymphocytes were published in Lupus in July 2010.

Bz-423 is an important prototype for Lycera’s
bioenergetics program. The data with Bz-423 provide strong
validation of the mechanistic approach. The company has identified
other compounds that act through this same mechanism and will be
the basis of further advancement in the program.

About Autoimmune Diseases

Serious autoimmune diseases are a major and growing public
health problem. An autoimmune disorder is a condition that occurs
when the immune system mistakenly attacks and destroys healthy body
tissue. There are more than 80 different types of autoimmune
disorders1, and approximately 50 million Americans, or one in five
people, suffer from autoimmune diseases2.

Currently available biologic drugs are typically very costly and
have been associated with significant risks including opportunistic
infections and death. Despite these limitations, they generate more
than $13 billion in annual sales. There is a clear need for oral
drugs that demonstrate the efficacy of biologics, but with improved
safety and administration profiles.

About Lycera

Lycera Corp. is focused on the discovery and development of
selective, small-molecule immunomodulators for the treatment of
patients with autoimmune diseases such as rheumatoid arthritis,
psoriasis and inflammatory bowel disease. Lycera is developing drug
candidates that target two novel therapeutic pathways and have the
potential for first-in-class oral efficacy without the adverse
effects of current standard-of-care antiproliferative and
immunosuppressive agents. Lycera is focused on the emerging area of
cellular bioenergetics to selectively target and silence
pathologically activated cells. The company also has a program
targeting the Th17 pathway through the inhibition of ROR-gamma.
Lycera’s leadership team and advisors represent the core
thought leaders in immunology, inflammation, organ transplantation
and kinase biology and are responsible for key advances and
discoveries in these fields. Visit www.lycera.com<http://www.lycera.com>for
more information.

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